It’s important to know the plans for the home. You can refinance to remove one person from the loan or sell the house.

Texas is a community property state. A refinance may not be necessary if you dictate in the divorce decree who will be obligated to make the payments. However, the downside is that the departing spouse’s credit is still tied to the home. If the occupying spouse misses a payment, it would still negatively affect the other’s credit. That’s why I recommend refinancing.

The timing will dictate whether an owelty lien is used. In Texas, if you’re trying to refinance to remove one spouse, many times you need to take cash out to pay them their share of the equity. Texas has limits for the maximum loan-to-value you can have on a cash-out refinance of 80%. Depending on what the home appraises at or the agreed payment, it may or may not be enough equity to take out. The alternative is the owelty lien, which gets put on the property for the agreed-upon amount and prevents the occupying spouse from refinancing or selling the property without guaranteeing payment to the departing spouse.

It’s the most secure way to get equity out of the home. However, it needs to be agreed upon before the divorce is finalized. Sadly, I many people come to me after the divorce is already finalized, so this option is off the table.

Selling the property releases both parties from the obligation of the mortgage, but they both still need to move somewhere. That’s why it’s still important to speak with a mortgage lender to get the situation resolved.

For more information on this sensitive topic, click here.

If you or anyone you know is in this situation and needs guidance, don’t hesitate to give me a call or send me an email. It would be my honor to help you through this process.

About Wade Betz

Wade joined Guardian Mortgage in January 2006 as a vice president of sales and branch manager at ourDallas, Texas location.

Wade has a message for Guardian’s customers. There’s more to a mortgage than the close. Wade, like his Guardian counterparts, understands that a job well done is a job that lasts the duration of the home loan. Counsel, support and personal service are paramount to becoming a trusted mortgage advisor for Guardian’s clients.

Your local Dallas mortgage lender. Call us at 469-906-2522 to learn more.

Hear what people are saying about us:

We could not have had a better experience with the Betz Team and Guardian Mortgage. My husband and I were wrestling with a big bank loan, and after a lot of back and forth and unresponsiveness, we decided to switch to the Betz Team. Boy, what a difference! Wade, Felisa, Nat...

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We could not have had a better experience with the Betz Team and Guardian Mortgage. My husband and I were wrestling with a big bank loan, and after a lot of back and forth and unresponsiveness, we decided to switch to the Betz Team. Boy, what a difference! Wade, Felisa, Natalia, and Patrice are amazing and walked us through every step of the process. As first-time home buyers, we received the guidance and knowledge we needed. The customer service of the Betz Team is superior and we completely trusted them to help us through this important financial decision.

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- Katie

It was absolutely a pleasure working with Guardian Mortgage and the Betz Team; this is our fifth mortgage with Guardian, and the experience was just as smooth and expeditious as the very first time. The entire staff at Guardian was always so cheerful, responsive, courteous ...

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It was absolutely a pleasure working with Guardian Mortgage and the Betz Team; this is our fifth mortgage with Guardian, and the experience was just as smooth and expeditious as the very first time. The entire staff at Guardian was always so cheerful, responsive, courteous and knowledgeable; it truly eased the stress that such a potentially stressful process can create!

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- Harris

The Betz Team was phenomenal in helping us buy our house. From the beginning when we needed help with our offer letters to then providing a quick close, The Betz Team made sure that we were taken care of. I will recommend them to anyone that is in need of mortgage services....

The Betz Team was phenomenal in helping us buy our house. From the beginning when we needed help with our offer letters to then providing a quick close, The Betz Team made sure that we were taken care of. I will recommend them to anyone that is in need of mortgage services. 10 STARS!

- Laura

We are thrilled to have obtained our mortgage through Wade Betz and his wonderful team at Guardian! I would thoroughly recommend working with him and Natasha and all the others who helped our loan go through. Their web portal was easy to upload documents to and when I had t...

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We are thrilled to have obtained our mortgage through Wade Betz and his wonderful team at Guardian! I would thoroughly recommend working with him and Natasha and all the others who helped our loan go through. Their web portal was easy to upload documents to and when I had the inevitable question I was able to contact someone and get my answer quickly. I'm also happy to keep our mortgage locally here in Texas.

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- Heather

Great service, friendly staff, smooth transaction, as always! Wade is very pleasant to work with, as well as those on his team! He stayed in touch with me at each step along the way and he keeps in touch with us throughout the year as well with helpful tips, recipes and of ...

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Great service, friendly staff, smooth transaction, as always! Wade is very pleasant to work with, as well as those on his team! He stayed in touch with me at each step along the way and he keeps in touch with us throughout the year as well with helpful tips, recipes and of course the Dallas Cowboys game schedule magnet for the fridge! Thanks for everything! I tell everyone how much I have loved working with Guardian Mortgage Co.